East Africa a virgin Island for global trends

The world is fast shrinking into a village. This statement denoting the breaking of barriers and structuring of world social economic affairs in a global village rings very true in the retail world.

In east Africa just like in other parts of the world, the consumer is turning out to be extremely discerning and aspiration-al. Most consumers prefer to use internationally manufactured products that satisfy their psychological preferences’.

This trend for me is a cue to sound an alarm for local manufacturers to address the challenge. Consumers will easily shift from brands with a local heritage to international brands unless we can quickly move to raise quality standards, packaging and value addition.

The future of the regional retail sector will beyond investment continue to rely heavily on local manufacturers. However, these manufacturers must also rise to the occasion by adopting international standards.
In my view, the challenge of maintaining world class standards cannot be underrated. Given the growth in literacy levels and exposure to international standards due to increased travel, Africans are demanding and expecting similar standards as those practiced abroad.

For example within the retail sector where we serve diplomats, east Africans returning from the diaspora and other well-travelled east Africans, we can’t afford to present mediocre retail services.
Our customers at a minimum expect us to meet and where possible exceed standards they’ve experienced internationally.

This means that we have to invest heavily in store stocking with a mix of international and local brands. It also means the ambience within the stores has to be tastefully done and the location of the stores also has to be in the finest developments.

I keep reiterating that unlike in the West, where stores are within arm’s reach, East Africa as a whole remains a virgin island as far as the retail market is concerned.

The citizens and expatriates living here demand products/ services that can satisfy their dynamic lifestyle needs. Thus, the opportunity for retail investments remains high.

To justify my thoughts on retail, I’ve time and again resorted to using Kenya as a country case study. Use of the Kenyan environment and scenarios remain very valid as Kenya is highly representative of the other east African countries.

Another challenge that is weighing heavily on me is the growing incidents’ of organised pilferage. What we previously thought to be small time cases of shoplifting has unfortunately evolved to become an organised crime leading to high shrinkage rates on our stockholding.

It’s extremely alarming to note conventional in-store policing measures are not helping much on this score given that these organised rings are now looping in our own staff in this schemes.

The industry pilferage rate should always be at less than two per cent but this appears to be growing at a fast rate. With the formal retail trade market estimated to be worth more than Sh200 billion the industry could well be losing more than Sh3 billion annually to shoplifters among other loss avenues.
In my view, beyond surveillance systems, there’s a need to review existing laws to make them more punitive both for shoplifters and also for employees tried under theft by servant clauses.

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